Common use of Adjustments to Base Purchase Price Clause in Contracts

Adjustments to Base Purchase Price. The portion of the Base Purchase Price payable pursuant to Section 3.1.1 will be adjusted as follows: 3.2.1 If the Business has fewer than 56,820 EBS's as of the Closing Date, the Base Purchase Price will be reduced by an amount equal to $2,288 multiplied by the difference between (x) 56,820 and (y) the number of EBS's as of the Closing Date. 3.2.2 Adjustments on a pro rata basis as of the Closing Date will be made for all prepaid expenses (to the extent such prepayments may accrue to Buyer's benefit), prepaid income and accounts receivable of active subscribers, and to reflect the principle that all expenses (including real estate taxes, stand by fees and assessment by any taxing authority for the Real Property) and income attributable to the Business for the period prior to the Closing Date are for the account of Seller, and all expenses and income attributable to the Business for the period on and after the Closing Date are for the account of Buyer; provided, however, that Seller and Buyer shall not prorate any items or expense payables under any Excluded Assets, all of which shall remain and be solely for the account of Seller. Seller will receive no credit for any accounts receivable (i) any portion of which is more than sixty (60) days past due as of the Closing Date, or (ii) from subscribers whose accounts are inactive or whose service is pending disconnection for any reason as of the Closing Date. 3.2.3 All advance payments to, or funds of third parties on deposit with, Seller as of the Closing Date, relating to the Business, including advance payments and deposits by subscribers served by the Business for converters, encoders, decoders, cable television service and related sales, will be retained by Seller and will reduce the Base Purchase Price accordingly. 3.2.4 All deposits relating to the Business that are held by third parties as of the Closing Date for the account of Seller or as security for Seller's performance of its obligations (other than with respect to (i) Excluded Assets; and (ii) any other deposits the full benefit of which will not be available to Buyer following the Closing Date); provided, however, credit will be given for those deposits for which partial credit can be determined, including deposits on leases and deposits for utilities, will be credited to the account of Seller in their full amounts to increase the Base Purchase Price and will become the property of Buyer. 3.2.5 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by an amount equal to the difference between (i) the amounts of the required cumulative capital expenditures for each of the categories designated as Items 1 through 9 as set forth on SCHEDULE 7.2.1 through the month of the Closing and (ii) the amount of the capital expenditures actually incurred and paid in cash by Seller through the Closing Date in connection with each such corresponding capital expenditure categories. By way of example, SCHEDULE 7.2.1 sets forth a budgeted $5,000 per month in the year 2000 in capital expenditures for the category of New Construction. If the Closing Date were to occur in February 2000, the cumulative monthly capital expenditures for that category through February 2000 would total $147,000. To the extent that Seller had only expended $142,000 in cash in this category through the Closing Date, the reduction in the Base Purchase Price payable pursuant to Section 3.1.1 would be $5,000. Similar adjustments would be made on a category by category basis. 3.2.6 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by an amount equal to the difference between (i) the amounts of the Cumulative Capital Expenditures for the category designated as Item 10 as set forth on SCHEDULE 7.2.1 through the month of the Closing and (ii) the amount of the capital expenditures actual incurred and paid in cash by Seller through the Closing Date in connection with the category designated as Item 10 of SCHEDULE 7.2.1; provided, however, to the extent that through the date of Closing Seller has exceed the capital expenditure budgeted amounts for any of the capital categories designated as Items 1 through 9 on SCHEDULE 7.2.1, such amounts shall be allowed as credit against any reduction otherwise to be made pursuant to this Section 3.2.6.

Adjustments to Base Purchase Price. (a) The portion of the Base Purchase Price payable pursuant to Section 3.1.1 will shall be adjusted as follows: 3.2.1 If (i) The Base Purchase Price shall be increased by the Business sum of the following: (A) an amount equal to any Property Taxes and Hydrocarbon Taxes paid by Seller as of Closing to the extent attributable (as contemplated and prorated under Section 1.7) to the Interim Period; (B) an amount equal to all Operating Expenses attributable to the Purchased Assets that are incurred in the ordinary course of business and paid by Seller prior to Closing, to the extent attributable to the Interim Period, as calculated in accordance with GAAP and this Section 1.6; provided, however, in clause (A) above and this clause (B), that Seller has fewer not been reimbursed by a Third Person for any expenses so paid by Seller, other than 56,820 EBS's any amounts reimbursed or paid pursuant to the Enerplus Carry; (C) to the extent not covered in the preceding paragraph, an amount equal to all prepaid expenses, including water stored in water impoundments that are included within the Purchased Assets, attributable to the Purchased Assets at or after the Effective Time that were paid by or on behalf of Seller, including without limitation, prepaid drilling and/or completion costs and prepaid utility charges, as described on Schedule 1.6; (D) to the extent the proceeds thereof are not received by Seller as of Closing, an amount equal to the value of Seller’s share of all marketable Effective Time Tank Oil to be calculated as follows: the value shall be the product of (x) the volume of marketable Effective Time Tank Oil (attributable to Seller’s interest) as of the Closing DateEffective Time as shown by the gauging reports prepared by Seller as of the Effective Time (absent any manifest errors), multiplied by (y) the price actually received for July 2010 production under applicable marketing contracts less Seller’s share of Royalties, Hydrocarbon Taxes and other burdens on production; (E) on all Additional Properties, Buyer shall pay Seller $8,000 per Net Mineral Acre; and (F) any other amount agreed to by Buyer and Seller. (ii) The Base Purchase Price shall be reduced by the sum of the following: (A) an amount equal to any unpaid Property Taxes and Hydrocarbon Taxes paid or payable by or on behalf of Buyer that are attributable to periods of time before the Effective Time, which amounts shall, to the extent not actually assessed as of the Effective Time, be computed and prorated in accordance with Section 1.7; (B) an amount equal to any and all Operating Expenses attributable to the Purchased Assets that are paid by or on behalf of Buyer that are attributable to periods of time before the Effective Time, as calculated in accordance with GAAP and this Section 1.6; (C) aggregate net proceeds received by Seller attributable to the Purchased Assets, including proceeds from the sale of Hydrocarbons, that are attributable to the Interim Period, as calculated in accordance with GAAP and this Section 1.6; (D) an amount equal to the value of Hydrocarbons produced from or allocable to the Subject Interests that a Third Person may otherwise be entitled to receive out of Seller’s interest in the Subject Interests after the Effective Time without making full payment therefor at or after the time of delivery as the result of a “take or pay,” prepayment, forward sale, production payment, deferred production, or similar arrangement in existence at any time during the Interim Period; (E) the amount of suspended funds Buyer assumes responsibility for pursuant to Section 11.10; and (F) any other amount agreed to by Buyer and Seller. (iii) The Base Purchase Price shall be reduced (in the event Seller is net overproduced) or increased (in the event Seller is net underproduced), as the case may be, by the volumetric difference between the actual aggregate net gas Imbalance as of the Effective Time and 0 mcf (which is Seller’s current estimate of the aggregate net gas Imbalance (cumulative working interests), as more particularly set forth for each of the Purchased Assets in Schedule 1.5) multiplied by $2.00 per net mcf. (b) The net adjustment to the Base Purchase Price that results from the application of Section 1.6(a) is referred to as the “Purchase Price Adjustment.” If the Purchase Price Adjustment is positive, the Base Purchase Price will shall be reduced increased by an amount equal to $2,288 multiplied by the difference between (x) 56,820 and (y) the number of EBS's as of the Closing Date. 3.2.2 Adjustments on a pro rata basis as of the Closing Date will be made for all prepaid expenses (to the extent such prepayments may accrue to Buyer's benefit), prepaid income and accounts receivable of active subscribers, and to reflect the principle that all expenses (including real estate taxes, stand by fees and assessment by any taxing authority for the Real Property) and income attributable to the Business for the period prior to the Closing Date are for the account of Seller, and all expenses and income attributable to the Business for the period on and after the Closing Date are for the account of Buyer; provided, however, that Seller and Buyer shall not prorate any items or expense payables under any Excluded Assets, all of which shall remain and be solely for the account of Seller. Seller will receive no credit for any accounts receivable (i) any portion of which is more than sixty (60) days past due as of the Closing Date, or (ii) from subscribers whose accounts are inactive or whose service is pending disconnection for any reason as of the Closing Date. 3.2.3 All advance payments to, or funds of third parties on deposit with, Seller as of the Closing Date, relating to the Business, including advance payments and deposits by subscribers served by the Business for converters, encoders, decoders, cable television service and related sales, will be retained by Seller and will reduce the Base Purchase Price accordingly. 3.2.4 All deposits relating to the Business that are held by third parties as of the Closing Date for the account of Seller or as security for Seller's performance of its obligations (other than with respect to (i) Excluded Assets; and (ii) any other deposits the full benefit of which will not be available to Buyer following the Closing Date); provided, however, credit will be given for those deposits for which partial credit can be determined, including deposits on leases and deposits for utilities, will be credited to the account of Seller in their full amounts to increase the Base Purchase Price and will become the property of Buyer. 3.2.5 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by an amount equal to the difference between (i) the amounts of the required cumulative capital expenditures for each of the categories designated as Items 1 through 9 as set forth on SCHEDULE 7.2.1 through the month of the Closing and (ii) the amount of the capital expenditures actually incurred and paid in cash by Seller through the Closing Date in connection with each such corresponding capital expenditure categories. By way of example, SCHEDULE 7.2.1 sets forth a budgeted $5,000 per month in the year 2000 in capital expenditures for the category of New ConstructionPurchase Price Adjustment. If the Closing Date were to occur in February 2000Purchase Price Adjustment is negative, the cumulative monthly capital expenditures for that category through February 2000 would total $147,000. To the extent that Seller had only expended $142,000 in cash in this category through the Closing Date, the reduction in the Base Purchase Price payable pursuant to Section 3.1.1 would be $5,000. Similar adjustments would be made on a category by category basis. 3.2.6 The Base Purchase Price payable pursuant to Section 3.1.1 will shall be reduced by an amount equal to the difference between (i) the amounts of the Cumulative Capital Expenditures for the category designated as Item 10 as set forth on SCHEDULE 7.2.1 through the month of the Closing and (ii) the amount of the capital expenditures actual incurred and paid in cash by Seller through the Closing Date in connection with the category designated as Item 10 of SCHEDULE 7.2.1; provided, however, to the extent that through the date of Closing Seller has exceed the capital expenditure budgeted amounts for any of the capital categories designated as Items 1 through 9 on SCHEDULE 7.2.1, such amounts shall be allowed as credit against any reduction otherwise to be made pursuant to this Section 3.2.6Purchase Price Adjustment.

Adjustments to Base Purchase Price. The portion of (a) To determine the Base Purchase Price payable pursuant to Section 3.1.1 will be adjusted (as follows: 3.2.1 If the Business has fewer than 56,820 EBS's as of the Closing Dateherein defined), the Base Purchase Price will shall be reduced by an amount equal to $2,288 multiplied increased by the difference between following amounts: (x) 56,820 and (yi) the number amount of EBS's all ad valorem, production, severance, property or similar Taxes paid by Seller and relating to the Assets for periods from and after the Effective Time, calculated in a similar fashion as set forth in Section 2.3(b)(i); (ii) the aggregate amount of any and all operating costs paid by Seller that relate to the Closing DateAssets for periods from and after the Effective Time (excluding amounts for which the Base Purchase Price is increased pursuant to Section 2.3(a)(i) above), including, but not limited to, lease operating expenses, transportation and marketing expenses, lease payments, severance and production Taxes and producing overhead rates; (iii) the aggregate amount of any and all capital expenditures actually made by Seller or on Seller’s behalf in accordance with the terms of this Agreement and that relate to the Assets for periods from and after the Effective Time; and (iv) any other amount agreed upon by the parties in writing. 3.2.2 Adjustments on a pro rata basis as (b) To determine the Purchase Price, the Base Purchase Price shall be decreased by the following amounts: (i) the amount of all of Seller’s unpaid ad valorem, production, severance, property or similar Taxes relating to the Closing Date will be made for all prepaid expenses Assets, to the extent that such unpaid Taxes relate to periods of time before the Effective Time (to the extent that any such prepayments may accrue to Buyer's benefit)amount has not been finally determined by Closing or any other date of determination, prepaid income and accounts receivable of active subscribers, and to reflect such amount will be estimated based upon the principle that all expenses (including real estate taxes, stand by fees and assessment by any taxing authority amount paid for the Real Property) and income attributable to the Business previous year for the period prior to the Closing Date are for the account of Seller, and all expenses and income attributable to the Business for the period on and after the Closing Date are for the account of Buyer; provided, however, that Seller and Buyer shall not prorate any items same Asset or expense payables under any Excluded Assets, all of which shall remain and be solely for the account of Seller). Seller will receive no credit for any accounts receivable (i) any portion of which is more than sixty (60) days past due as of the Closing Date, or (ii) from subscribers whose accounts are inactive or whose service is pending disconnection for any reason as of the Closing Date. 3.2.3 All advance payments to, or funds of third parties on deposit with, Seller as of the Closing Date, relating to the Business, including advance payments and deposits by subscribers served by the Business for converters, encoders, decoders, cable television service and related sales, will be retained by Seller and will reduce the Base Purchase Price accordingly. 3.2.4 All deposits relating to the Business that are held by third parties as of the Closing Date for the account of Seller or as security for Seller's performance of its obligations (other than Such Taxes with respect to (i) Excluded Assets; and (ii) any other deposits a period which the full benefit Effective Time splits shall be prorated based on the number of days in such period which will not be available to Buyer following the Closing Date); provided, however, credit will be given for those deposits for which partial credit can be determined, including deposits fall on leases and deposits for utilities, will be credited to the account of Seller in their full amounts to increase the Base Purchase Price and will become the property of Buyer. 3.2.5 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by an amount equal to the difference between (i) the amounts each side of the required cumulative capital expenditures for each of the categories designated as Items 1 through 9 as set forth on SCHEDULE 7.2.1 through the month of the Closing and (ii) the amount of the capital expenditures actually incurred and paid in cash by Seller through the Closing Date in connection with each such corresponding capital expenditure categories. By way of example, SCHEDULE 7.2.1 sets forth a budgeted $5,000 per month in the year 2000 in capital expenditures for the category of New Construction. If the Closing Date were to occur in February 2000, the cumulative monthly capital expenditures for that category through February 2000 would total $147,000. To the extent that Seller had only expended $142,000 in cash in this category through the Closing Date, the reduction in the Base Purchase Price payable pursuant to Section 3.1.1 would be $5,000. Similar adjustments would be made on a category by category basis. 3.2.6 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by an amount equal to the difference between (i) the amounts of the Cumulative Capital Expenditures for the category designated as Item 10 as set forth on SCHEDULE 7.2.1 through the month of the Closing and (ii) the amount of the capital expenditures actual incurred and paid in cash by Seller through the Closing Date in connection with the category designated as Item 10 of SCHEDULE 7.2.1Effective Time; provided, provided however, to the extent that through such Taxes are computed based on the date production from the Assets, such Taxes shall be prorated between the parties based on the period in which such Production which is the basis for such calculation occurs, in the same manner as the parties are entitled to receive (or be credited with) such production pursuant to the terms hereof; (ii) amounts equal to all revenues (net of Closing royalty, overriding royalty payments and similar such payments) collected by Seller has exceed that are attributable to Production from the capital expenditure budgeted amounts for Assets (but not taking into account any ▇▇▇▇▇▇) and relating to periods of time from and after the Effective Time; (iii) to the extent such amount exceeds the Title Defect Basket, the aggregate of the capital categories designated Title Defect Amounts (as Items 1 through 9 defined in the Title Defect Mechanism) with respect to those Title Defects that are asserted during the Title Examination Period and agreed to by Seller; (iv) the amounts held in suspense as shown on SCHEDULE 7.2.1, such amounts shall be allowed as credit against Schedule 3.4(d); and (v) any reduction otherwise to be made pursuant to this Section 3.2.6other amount agreed upon by the parties in writing.

Adjustments to Base Purchase Price. The portion of the Base Purchase Price payable pursuant to Section 3.1.1 will shall be adjusted as follows: 3.2.1 If the Business has fewer than 56,820 EBS's as of the Closing Date, the Base Purchase Price will be reduced by an amount equal to $2,288 multiplied by the difference between (xa) 56,820 and (y) the number of EBS's as of the Closing Date. 3.2.2 Adjustments on a pro rata basis as of the Closing Date will be made for all prepaid expenses (to the extent such prepayments may accrue to Buyer's benefit), prepaid income and accounts receivable of active subscribers, and to reflect the principle that all expenses (including real estate taxes, stand by fees and assessment by any taxing authority for the Real Property) and income attributable to the Business for the period prior to the Closing Date are for the account of Seller, and all expenses and income attributable to the Business for the period on and after the Closing Date are for the account of Buyer; provided, however, that Seller and Buyer shall not prorate any items or expense payables under any Excluded Assets, all of which shall remain and be solely for the account of Seller. Seller will receive no credit for any accounts receivable (i) any portion of which is more than sixty (60) days past due as of the Closing Date, or (ii) from subscribers whose accounts are inactive or whose service is pending disconnection for any reason as of the Closing Date. 3.2.3 All advance payments to, or funds of third parties on deposit with, Seller as of the Closing Date, relating to the Business, including advance payments and deposits by subscribers served by the Business for converters, encoders, decoders, cable television service and related sales, will be retained by Seller and will reduce the Base Purchase Price accordingly. 3.2.4 All deposits relating to the Business that are held by third parties as of the Closing Date for the account of Seller or as security for Seller's performance of its obligations (other than with respect to (i) Excluded Assets; and (ii) any other deposits the full benefit of which will not be available to Buyer following the Closing Date); provided, however, credit will be given for those deposits for which partial credit can be determined, including deposits on leases and deposits for utilities, will be credited to the account of Seller in their full amounts to increase the Base Purchase Price and will become the property of Buyer. 3.2.5 The Base Purchase Price payable pursuant shall be increased by the following (without duplication): (i) the amount of all production expenses, operating expenses and all expenditures (whether capitalized or expensed) attributable to the Properties, incurred after the Effective Time and paid by Seller (but excluding all costs and expenses incurred in connection with the drilling, equipping, testing and completion of the ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ 32-10 #4 well located in ▇▇▇▇▇ County, Mississippi and the construction and installation of production and transportation facilities associated with such well), and all costs and expenses (whether capitalized or expensed) incurred and paid by Seller, whether before or after the Effective Time, in connection with the drilling, equipping, testing and completion of the Frost 5-10 #2 well located in ▇▇▇▇▇ County, Mississippi and the construction and the installation of production and transportation facilities associated with such well. (ii) the total sales proceeds of all Hydrocarbons, net of royalties and severance taxes paid by Buyer to third parties, attributable to the Properties, produced prior to the Effective Time and collected by Buyer, and any other monies collected by Buyer with respect to the ownership or operation of the Properties and attributable to periods prior the Effective Time, including insurance proceeds collected with respect to losses and events that occurred prior to the Effective Time; (iii) Asset Taxes paid by Seller that are attributable to periods (or portions thereof) beginning on or after the Effective Time, other than any such Asset Taxes which either (x) are taken into account in the computations under Section 3.1.1 will be reduced 3.3(b)(i) or (y) are assumed and paid (or if paid by Seller, reimbursed to Seller) by Buyer. (iv) an amount equal to the difference between sum of any upward adjustments provided elsewhere in this Agreement; (v) the value (determined by the price most recently paid prior to the Effective Time for such oil less applicable deductions) of all oil and other liquid Hydrocarbons in storage or existing in stock tanks; (vi) the net amount of all prepaid expenses related to the Properties (including without limitation prepaid production taxes, severance taxes, and other taxes measured by units of production; bonuses; rentals; cash calls to third Person operators; insurance premiums; and scheduled payments); and (vii) any other amount agreed upon by Seller and Buyer in writing prior to Closing. (b) The Base Purchase Price shall be decreased by the following (without duplication): (i) the amounts total sales proceeds of all Hydrocarbons, net of royalties and severance taxes paid by Seller to third parties, attributable to the Properties, produced after the Effective Time and collected by Seller, and any other monies collected by Seller with respect to the ownership or operation of the required cumulative capital expenditures for each of Properties and attributable to periods after the categories designated as Items 1 through 9 as set forth on SCHEDULE 7.2.1 through Effective Time, excluding insurance proceeds collected with respect to losses and events that occurred prior to the month of the Closing and Effective Time; (ii) the amount of all production expenses, operating expenses and all expenditures (whether capitalized or expensed) attributable to the capital expenditures actually Properties, incurred prior to the Effective Time and paid by Buyer, but excluding costs and expenses incurred in connection with the Frost 5-10 #2 well located in ▇▇▇▇▇ County, Mississippi; (iii) all costs and expenses (whether capitalized or expensed) incurred and paid in cash by Seller through Buyer, whether before or after the Closing Date Effective Time, in connection with each the drilling, equipping, testing and completion of the ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ 32-10 #4 well located in ▇▇▇▇▇ County, Mississippi and the construction and the installation of production and transportation facilities associated with such corresponding capital expenditure categories. By way well. (iv) the amount of exampleall unpaid Asset Taxes which accrued with respect to the Properties for periods prior to the Effective Time and were either paid or assumed by Buyer; such amount shall, SCHEDULE 7.2.1 sets forth a budgeted $5,000 per month where possible, be computed based upon the tax rate and values applicable to the tax period in question; otherwise, the year 2000 in capital expenditures amount of the adjustment under this Section 3.3(b)(iv) shall be computed based upon such taxes assessed against the applicable portion of the Properties for the category of New Construction. If the Closing Date were to occur in February 2000, the cumulative monthly capital expenditures for that category through February 2000 would total $147,000. To the extent that Seller had only expended $142,000 in cash in this category through the Closing Date, the reduction in the Base Purchase Price payable pursuant to Section 3.1.1 would be $5,000. Similar adjustments would be made on a category by category basis.immediately preceding tax period; 3.2.6 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by (v) an amount equal to the difference between sum of any downward adjustments provided elsewhere in this Agreement; (ivi) an amount equal to the amounts sum of all Interests Held In Suspense at Closing by Seller with respect to any of the Cumulative Capital Expenditures for the category designated as Item 10 as set Properties; and (vii) any other amount agreed upon by Seller and Buyer in writing prior to Closing. Seller shall prepare, and at Closing Seller and Buyer shall execute, a statement setting forth on SCHEDULE 7.2.1 through the month of the Closing and (ii) the amount of the capital expenditures actual incurred and paid in cash by Seller through the Closing Date in connection with the category designated as Item 10 of SCHEDULE 7.2.1; provided, however, each adjustment to the extent that through the date of Closing Seller has exceed the capital expenditure budgeted amounts for any of the capital categories designated as Items 1 through 9 on SCHEDULE 7.2.1, such amounts shall be allowed as credit against any reduction otherwise Base Purchase Price to be made pursuant to Sections 3.3(a) and (b) (the “Closing Settlement Statement”). The Closing Payment payable by Buyer at Closing shall be adjusted pursuant to the Closing Settlement Statement which shall be based on a good faith estimate by Seller when complete, actual information is not available. (c) No later than ninety (90) days after the Closing, Seller shall prepare and deliver to Buyer, in accordance with this Agreement, a statement (the “Final Settlement Statement”) setting forth each adjustment to the Base Purchase Price under Sections 3.3(a) and (b) of this Agreement as finally determined as of the Closing and showing the calculation of such adjustments. As soon as practicable after receipt of the Final Settlement Statement, but no later than thirty (30) days after such receipt, Buyer shall deliver to Seller a written report containing all changes that Buyer proposes to the Final Settlement Statement. The Parties shall undertake to agree with respect to the amounts due pursuant to such post-Closing adjustments not later than fifteen (15) days after delivery of Buyer’s requested changes. If Buyer fails to propose any changes to the Final Settlement Statement within the time set forth above, it shall be deemed that Buyer agrees with the Final Settlement Statement, which shall become final and binding on the Parties. (d) If Seller and Buyer are unable to agree upon any adjustment to the Base Purchase Price under Section 3.3(d) no later than fifteen (15) days after delivery of Buyer’s requested changes, if any, then ▇▇▇▇▇▇, LLP, Ft. Worth, Texas is designated to act as an arbiter and to decide all points of disagreement with respect to such matters in accordance with the terms of this Agreement, such decision to be rendered within thirty days (30) days after such arbiter is informed by one or both of the Parties that it shall decide the matters in controversy. Such decision shall be final and binding upon the Parties. If such firm is unwilling or unable to serve in such capacity, Seller and Buyer shall attempt, in good faith, to designate another acceptable Person or firm as the sole arbiter of such matters. If the Parties are unable to agree upon the designation of a firm of independent public accountants as substitute arbiter, then Seller or Buyer shall in writing request the American Arbitration Association to appoint such a firm as substitute arbiter. The arbitration shall be conducted under the rules of the American Arbitration Association to the extent such rules do not conflict with the terms of applicable state law and terms of this Agreement. The costs and expenses of the arbiter, whether the firm designated above or a firm appointed pursuant to this subsection (e), shall be shared one-half by Seller and one-half by Buyer. Within five (5) days after the decision of the arbiter, Buyer or Seller, as the case may be, shall make a cash payment to the other equal to the sum as may be found to be due pursuant to the Final Settlement Statement and the arbiter’s decision. (e) Notwithstanding anything to the contrary set forth herein, should Seller, after Closing, receive post-Effective Time revenues attributable to the Properties, Seller shall within five (5) Business Days of receipt remit such revenues to Buyer. Likewise, should Buyer, after Closing, receive pre-Effective Time revenues attributable to the Properties, Buyer shall within five (5) Business Days of receipt remit such revenues to Seller. (f) It is the intent of the Parties that any adjustment made pursuant to this Section 3.2.63.3 shall be made only once and without duplication.

Adjustments to Base Purchase Price. The portion of (a) To determine the Purchase Price, the Base Purchase Price payable shall be increased by the following amounts: (i) the amount of all Severance Taxes and Property Taxes paid by Sellers and allocated to Buyer in accordance with Section 7.2; (ii) the aggregate amount of any and all Property Costs paid by Sellers for periods from and after the Effective Time (excluding amounts for which the Base Purchase Price is increased pursuant to Section 3.1.1 will 2.5(a)(i) or Section 2.5(a)(iii)), but not including (i) capital expenditures for which Sellers are obligated as set forth on Schedule 5.1, (ii) any costs or expenses incurred with respect to the ownership and operation of the Assets paid or payable to an Affiliate of Seller (other than overhead charges, paid to REO in REO’s capacity as operator of the Assets, which shall be adjusted deemed to be Property Costs to the extent incurred in the ordinary course of business in accordance with an operating agreement in effect as follows:of the date hereof and shall not exceed $500.00 per Well in any calendar month), (iii) any amounts incurred in connection with the cure or remediation by Seller of any Title Defects or Environmental Defects in accordance with this Agreement, (iv) any costs and expenses incurred for repairs or otherwise in relation to the fire damage to the Casualty Well and (v) any capital expenditures incurred by Sellers between the Effective Time and Closing in respect of the ▇▇▇▇▇▇▇▇ 8H Well and the ▇▇▇▇▇▇▇▇ 9H Well; 3.2.1 If (iii) the Business has fewer than 56,820 EBS's aggregate amount of any and all capital expenditures relating to the Assets for which Buyer is responsible as set forth on Exhibit D that are paid by Sellers (excluding amounts for which the Base Purchase Price is increased pursuant to Section 2.5(a)(i) or Section 2.5(a)(ii)); (iv) the value of all Production in storage and line fill as of the Effective Time with the value per MMBTU to be the TETCO-M2 price as of the Closing Date, and any imbalances of natural gas owed by third parties to Sellers and attributable to the Assets or the production therefrom as of the Effective Time, less applicable royalties, other burdens on production, taxes and applicable transportation, marketing and gathering fees; and (v) any other amount agreed upon by the Parties in writing or set forth in this Agreement as an adjustment to the Base Purchase Price. (b) To determine the Purchase Price, the Base Purchase Price will shall be reduced decreased by an the following amounts: (i) the amount of all unpaid Property Taxes and Severance Taxes allocated to the Sellers in accordance with Section 7.2 and paid or otherwise economically borne by the Buyer; (ii) the aggregate amount of any and all Property Costs that relate to the Assets for periods before the Effective Time but that are borne by Buyer; (iii) amounts equal to $2,288 multiplied all revenues (net of royalty, overriding royalty payments and similar such payments) collected by Sellers that are attributable to production of oil or gas or other minerals from the difference between Assets (x) 56,820 and (y) the number of EBS's as of the Closing Date. 3.2.2 Adjustments on a pro rata basis as of the Closing Date will be made for all prepaid expenses (to the extent such prepayments may accrue to Buyer's benefit), prepaid income and accounts receivable of active subscribers, and to reflect the principle that all expenses (including real estate taxes, stand by fees and assessment by but not taking into account any taxing authority for the Real Property▇▇▇▇▇▇) and income attributable relating to the Business for the period prior to the Closing Date are for the account periods of Seller, and all expenses and income attributable to the Business for the period on time from and after the Closing Date are for the account of Buyer; provided, however, that Seller and Buyer shall not prorate any items or expense payables under any Excluded Assets, all of which shall remain and be solely for the account of Seller. Seller will receive no credit for any accounts receivable Effective Time; (iiv) any portion of which is more than sixty (60) days past due as of the Closing Date, or (ii) from subscribers whose accounts are inactive or whose service is pending disconnection for any reason as of the Closing Date. 3.2.3 All advance payments to, or funds of third parties on deposit with, Seller as of the Closing Date, relating to the Business, including advance payments and deposits by subscribers served by the Business for converters, encoders, decoders, cable television service and related sales, will be retained by Seller and will reduce the Base Purchase Price accordingly. 3.2.4 All deposits relating to the Business that are held by third parties as of the Closing Date for the account of Seller or as security for Seller's performance of its obligations (other than with respect to (i) Excluded Assets; and (ii) any other deposits the full benefit of which will not be available to Buyer following the Closing Date); provided, however, credit will be given for those deposits for which partial credit can be determined, including deposits on leases and deposits for utilities, will be credited to the account of Seller in their full amounts to increase the Base Purchase Price and will become the property of Buyer. 3.2.5 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by an amount equal to the difference between (i) the amounts amount of the required cumulative capital expenditures for each of the categories designated as Items 1 through 9 as accrued suspense funds set forth on SCHEDULE 7.2.1 through Schedule 2.5(b); (v) an amount, calculated in accordance with the month procedures of Exhibit A for Title Defects and Environmental Defects, equal to the Closing sum of (A) the agreed value of all Title Defects or Environmental Defects that are asserted prior to Closing, and remain uncured by Sellers at Closing, and (iiB) the amount Allocated Value of the capital expenditures actually incurred and paid in cash all Properties retained by Seller through the on account of disputed or resolved Title Defects and Environmental Defects; provided that Title Defects and Environmental Defects for which there is no agreement prior to Closing Date shall be addressed in connection accordance with each such corresponding capital expenditure categories. By way procedures of example, SCHEDULE 7.2.1 sets forth a budgeted $5,000 per month in the year 2000 in capital expenditures for the category of New Construction. If the Closing Date were to occur in February 2000, the cumulative monthly capital expenditures for that category through February 2000 would total $147,000. To the extent that Seller had only expended $142,000 in cash in this category through the Closing Date, the reduction in the Base Purchase Price payable pursuant to Section 3.1.1 would be $5,000. Similar adjustments would be made on a category by category basis.Exhibit A; 3.2.6 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by (vi) an amount equal to the difference between aggregate Allocated Values of Hard Consent Assets or other Assets excluded or retained pursuant to Section 5.4 or Section 5.9; (ivii) the amounts an amount equal to any reduction of the Cumulative Capital Expenditures for Base Purchase Price pursuant to Section 7.4 or Section 7.16; (viii) if the category designated as Item 10 ▇▇▇▇▇▇▇▇ Lease is retained pursuant to Section 7.13, an amount equal to 100% of the Allocated Value of the ▇▇▇▇▇▇▇▇ Lease, as set forth on SCHEDULE 7.2.1 through Exhibit C; (ix) the month Allocated Value of the Closing and EQT Release Acres, if any; and (iix) any other amount agreed upon by the amount of the capital expenditures actual incurred and paid Parties in cash by Seller through the Closing Date writing or set forth in connection with the category designated this Agreement as Item 10 of SCHEDULE 7.2.1; provided, however, an adjustment to the extent that through the date of Closing Seller has exceed the capital expenditure budgeted amounts for any of the capital categories designated as Items 1 through 9 on SCHEDULE 7.2.1, such amounts shall be allowed as credit against any reduction otherwise to be made pursuant to this Section 3.2.6Base Purchase Price.

Adjustments to Base Purchase Price. The portion of (a) To determine the Base Purchase Price payable pursuant to Section 3.1.1 will be adjusted (as follows: 3.2.1 If the Business has fewer than 56,820 EBS's as of the Closing Dateherein defined), the Base Purchase Price will shall be reduced by an amount equal to $2,288 multiplied increased by the difference between following amounts: (x) 56,820 and (yi) the number amount of EBS's all ad valorem, production, severance, property or similar Taxes paid by Seller and relating to the Assets for periods from and after the Effective Time, calculated in a similar fashion as set forth in Section 2.3(b)(i); (ii) the aggregate amount of any and all operating costs paid by Seller that relate to the Assets for periods from and after the Effective Time (excluding amounts for which the Base Purchase Price is increased pursuant to Section 2.3(a)(i) above), including, but not limited to, lease operating expenses, transportation and marketing expenses, lease payments, severance and production Taxes; (iii) the aggregate amount of any and all capital expenditures actually made by Seller or on Seller’s behalf in accordance with the terms of this Agreement and that relate to the Assets for periods from and after the Effective Time; (iv) the sum of $350,000.00 per month (prorated for parts of months) between the Effective Time and the Closing Date, as Seller’s overhead; (v) the aggregate amount of money equal to the value of all liquid Hydrocarbons above the load line in tanks on the Leases or in connection with the Assets, as measured and recorded by Seller in the ordinary course of business on November 1, 2011, at a price per barrel of oil or condensate of $90.00; (vi) The value of Imbalances due to Seller from third parties, at $3.59 per MMBtu of gas; (vii) the cost of the audit to be performed pursuant to Section 5.13, unless Buyer otherwise pays such costs; and (viii) any other amount agreed upon by the parties in writing. 3.2.2 Adjustments on a pro rata basis as (b) To determine the Purchase Price, the Base Purchase Price shall be decreased by the following amounts: (i) the amount of all of Seller’s unpaid ad valorem, production, severance, property or similar Taxes relating to the Closing Date will be made for all prepaid expenses Assets, to the extent that such unpaid Taxes relate to periods of time before the Effective Time (to the extent that any such prepayments may accrue to Buyer's benefit)amount has not been finally determined by Closing or any other date of determination, prepaid income and accounts receivable of active subscribers, and to reflect such amount will be estimated based upon the principle that all expenses (including real estate taxes, stand by fees and assessment by any taxing authority amount paid for the Real Property) and income attributable to the Business previous year for the period prior to the Closing Date are for the account of Seller, and all expenses and income attributable to the Business for the period on and after the Closing Date are for the account of Buyer; provided, however, that Seller and Buyer shall not prorate any items same Asset or expense payables under any Excluded Assets, all of which shall remain and be solely for the account of Seller). Seller will receive no credit for any accounts receivable (i) any portion of which is more than sixty (60) days past due as of the Closing Date, or (ii) from subscribers whose accounts are inactive or whose service is pending disconnection for any reason as of the Closing Date. 3.2.3 All advance payments to, or funds of third parties on deposit with, Seller as of the Closing Date, relating to the Business, including advance payments and deposits by subscribers served by the Business for converters, encoders, decoders, cable television service and related sales, will be retained by Seller and will reduce the Base Purchase Price accordingly. 3.2.4 All deposits relating to the Business that are held by third parties as of the Closing Date for the account of Seller or as security for Seller's performance of its obligations (other than Such Taxes with respect to (i) Excluded Assets; and (ii) any other deposits a period which the full benefit Effective Time splits shall be prorated based on the number of days in such period which will not be available to Buyer following the Closing Date); provided, however, credit will be given for those deposits for which partial credit can be determined, including deposits fall on leases and deposits for utilities, will be credited to the account of Seller in their full amounts to increase the Base Purchase Price and will become the property of Buyer. 3.2.5 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by an amount equal to the difference between (i) the amounts each side of the required cumulative capital expenditures for each of the categories designated as Items 1 through 9 as set forth on SCHEDULE 7.2.1 through the month of the Closing and (ii) the amount of the capital expenditures actually incurred and paid in cash by Seller through the Closing Date in connection with each such corresponding capital expenditure categories. By way of example, SCHEDULE 7.2.1 sets forth a budgeted $5,000 per month in the year 2000 in capital expenditures for the category of New Construction. If the Closing Date were to occur in February 2000, the cumulative monthly capital expenditures for that category through February 2000 would total $147,000. To the extent that Seller had only expended $142,000 in cash in this category through the Closing Date, the reduction in the Base Purchase Price payable pursuant to Section 3.1.1 would be $5,000. Similar adjustments would be made on a category by category basis. 3.2.6 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by an amount equal to the difference between (i) the amounts of the Cumulative Capital Expenditures for the category designated as Item 10 as set forth on SCHEDULE 7.2.1 through the month of the Closing and (ii) the amount of the capital expenditures actual incurred and paid in cash by Seller through the Closing Date in connection with the category designated as Item 10 of SCHEDULE 7.2.1Effective Time; provided, provided however, to the extent that through such Taxes are computed based on the date production from the Assets, such Taxes shall be prorated between the parties based on the period in which the production which is the basis for such calculation occurs, in the same manner as the parties are entitled to receive (or be credited with) such production pursuant to the terms hereof; (ii) amounts equal to all revenues (net of Closing royalty, overriding royalty payments and similar such payments) collected or earned by Seller has exceed that are attributable to the capital expenditure budgeted amounts for sale of Hydrocarbons from the Assets (but not taking into account any h▇▇▇▇▇) and relating to periods of time from and after the Effective Time; (iii) the aggregate of the capital categories designated Title Defect Amounts (as Items 1 through 9 on SCHEDULE 7.2.1defined in the Title Defect Mechanism) with respect to those Title Defects that are asserted during the Title Examination Period and agreed to by Seller as an adjustment to the Base Purchase Price; (iv) the aggregate of the Environmental Defect Amounts with respect to Environmental Defects asserted prior to the Defect Deadline and agreed to by Seller as an adjustment to the Base Purchase Price; (v) the aggregate of the Allocated Values attributable to W▇▇▇▇ affected by Required Consents if the applicable consent is not received prior to Closing; (vi) the amount of the Suspense Funds as of the Closing Date; and (vii) the value of Imbalances payable by Seller, such amounts shall be allowed as credit against at $3.59 per MMBtu of gas; (viii) any reduction otherwise to be made pursuant to this Section 3.2.6other amount agreed upon by the parties in writing.

Adjustments to Base Purchase Price. The portion of the Base Purchase Price payable pursuant to Section 3.1.1 will be adjusted as follows: 3.2.1 If (a) The Base Purchase Price will be adjusted upward by the Business following amounts (without duplication): (i) An amount equal to, to the extent that such amount has fewer been received by Buyer and not remitted or paid to Seller, the value of all Hydrocarbons from or attributable to the Assets in storage or existing in pipelines, plants and tanks (including inventory and line fill) and upstream of the sales meter as of the Effective Time, the value to be based upon the contract price in effect as of the Effective Time (or the sales price, if there is no contract price, in effect as of the Effective Time); (ii) Except to the extent covered by Section 3.02(a)(iv), an amount equal to all Property Expenses (excluding any expenses that are typically charged by Seller to the Assets in respect of its overhead, which are addressed in Section (iv)) and all other costs and expenses (excluding, for the avoidance of doubt, any Income Taxes, Assets Taxes, and Transfer Taxes) paid by Seller that are attributable to the Assets during the period from and after the Effective Time, whether paid before or after the Effective Time, including (A) bond and insurance premiums paid by or on behalf of Seller with respect to the Interim Period, (B) Burdens, (C) rental and other lease maintenance payments, and (D) prepayments for work or services performed (or to be performed) after the Effective Time; (iii) [RESERVED] (iv) a monthly overhead amount (for the period commencing from the Effective Time through the Closing Date, but not exceeding three (3) months in any event) equal to $110,000 per month, prorated for any partial month; (v) subject to Section 3.08, to the extent that Seller either (x) is underproduced for Hydrocarbons, or (y) has overdelivered any Hydrocarbons, in each case, as of the Effective Time as set forth in Schedule 4.10, as complete and final settlement of all Imbalances attributable to the Assets, the sum of (A) an amount equal to the product of the underproduced or overdelivered volumes times $4.50/MMBtu for gaseous Hydrocarbons, and (B) an amount equal to the product of the underproduced or overdelivered volumes times $70.00/Bbl for liquid Hydrocarbons; (vi) the amount of all Asset Taxes allocated to Buyer in accordance with Article XIII but only to the extent they are paid or otherwise economically borne by Seller; and (vii) any other amount provided for elsewhere in this Agreement or otherwise agreed upon in writing by Seller and Buyer. (b) The Base Purchase Price will be adjusted downward by the following amounts (without duplication): (i) an amount equal to, to the extent that such amount has been received by Seller and not remitted or paid to Buyer, all proceeds actually received by Seller attributable to the ownership or operation of the Assets, including the sale of Hydrocarbons produced from or allocable to such Assets during the period following the Effective Time, net of expenses (other than 56,820 EBS's Property Expenses and other expenses taken into account pursuant to Section 3.02(a), Income Taxes, Asset Taxes, and Transfer Taxes) directly incurred in earning or receiving such proceeds; (ii) if Seller makes the election under Section 11.02(d)(i) with respect to a Title Defect, the Title Defect Amount with respect to such Title Defect if the Title Defect Amount has been determined as of or prior to the Closing; (iii) if Seller makes the election under Section 12.01(c)(i) with respect to an Environmental Defect, the Remediation Amount with respect to such Environmental Defect if the Remediation Amount has been determined as of or prior to the Closing; (iv) the Allocated Value of the Assets excluded from the Transactions pursuant to Section 11.02(d)(ii), Section 11.04(b), Section 11.05(a), Section 11.05(b) or Section 12.01(c)(ii); (v) subject to Section 3.08, to the extent that Seller either (x) is overproduced for Hydrocarbons, or (y) has underdelivered any Hydrocarbons, in each case, as of the Effective Time as set forth in Schedule 4.10, as complete and final settlement of all Imbalances attributable to the Assets, the sum of (A) an amount equal to the product of the overproduced or underdelivered volumes times $4.50/MMBtu for gaseous Hydrocarbons, and (B) an amount equal to the product of the overproduced or underdelivered volumes times $70.00/Bbl for liquid Hydrocarbons; (vi) the amount of all Asset Taxes allocated to Seller in accordance with Article XIII but only to the extent they are paid or otherwise economically borne by Buyer; (vii) an amount equal to all proceeds from sales of Hydrocarbons arising from the Assets and payable to owners of Working Interests, royalties, overriding royalties and other similar interests (in each case) that are held by Seller in suspense as of the Closing Date; and (viii) any other amount provided for elsewhere in this Agreement or otherwise agreed upon in writing by Seller and Buyer. Notwithstanding anything to the contrary in this Agreement, all adjustments to the Base Purchase Price will be reduced by an amount equal to $2,288 multiplied by the difference between (x) 56,820 and (y) the number of EBS's as of the Closing Date. 3.2.2 Adjustments on a pro rata basis as of the Closing Date will shall be made for all prepaid expenses (only to the extent such prepayments may accrue to Buyer's benefit)Cash Consideration (the Cash Consideration, prepaid income and accounts receivable of active subscribers, and to reflect the principle that all expenses (including real estate taxes, stand by fees and assessment by any taxing authority for the Real Property) and income attributable to the Business for the period prior to the Closing Date are for the account of Seller, and all expenses and income attributable to the Business for the period on and after the Closing Date are for the account of Buyer; provided, however, that Seller and Buyer shall not prorate any items or expense payables under any Excluded Assets, all of which shall remain and be solely for the account of Seller. Seller will receive no credit for any accounts receivable (i) any portion of which is more than sixty (60) days past due as of the Closing Date, or (ii) from subscribers whose accounts are inactive or whose service is pending disconnection for any reason as of the Closing Date. 3.2.3 All advance payments to, or funds of third parties on deposit with, Seller as of the Closing Date, relating to the Business, including advance payments and deposits by subscribers served by the Business for converters, encoders, decoders, cable television service and related sales, will be retained by Seller and will reduce the Base Purchase Price accordingly. 3.2.4 All deposits relating to the Business that are held by third parties as of the Closing Date for the account of Seller or as security for Seller's performance of its obligations (other than with respect to (i) Excluded Assets; and (ii) any other deposits the full benefit of which will not be available to Buyer following the Closing Date); provided, however, credit will be given for those deposits for which partial credit can be determined, including deposits on leases and deposits for utilities, will be credited to the account of Seller in their full amounts to increase the Base Purchase Price and will become the property of Buyer. 3.2.5 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by an amount equal to the difference between (i) the amounts of the required cumulative capital expenditures for each of the categories designated as Items 1 through 9 as set forth on SCHEDULE 7.2.1 through the month of the Closing and (ii) the amount of the capital expenditures actually incurred and paid in cash by Seller through the Closing Date in connection with each such corresponding capital expenditure categories. By way of example, SCHEDULE 7.2.1 sets forth a budgeted $5,000 per month in the year 2000 in capital expenditures for the category of New Construction. If the Closing Date were to occur in February 2000so adjusted, the cumulative monthly capital expenditures for that category through February 2000 would total $147,000. To the extent that Seller had only expended $142,000 in cash in this category through the Closing Date, the reduction in the Base Purchase Price payable pursuant to Section 3.1.1 would be $5,000. Similar adjustments would be made on a category by category basis“Adjusted Cash Consideration”). 3.2.6 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by an amount equal to the difference between (i) the amounts of the Cumulative Capital Expenditures for the category designated as Item 10 as set forth on SCHEDULE 7.2.1 through the month of the Closing and (ii) the amount of the capital expenditures actual incurred and paid in cash by Seller through the Closing Date in connection with the category designated as Item 10 of SCHEDULE 7.2.1; provided, however, to the extent that through the date of Closing Seller has exceed the capital expenditure budgeted amounts for any of the capital categories designated as Items 1 through 9 on SCHEDULE 7.2.1, such amounts shall be allowed as credit against any reduction otherwise to be made pursuant to this Section 3.2.6.

Adjustments to Base Purchase Price. The portion of the Base Purchase Price payable pursuant (a) At least five (5) Business Days prior to Section 3.1.1 will be adjusted as follows: 3.2.1 If the Business has fewer than 56,820 EBS's as of the Closing Date, Seller shall cause to be prepared and delivered to Purchaser a closing statement (the Base Purchase Price will be reduced by an amount equal to $2,288 multiplied by “Closing Statement“) setting forth a good-faith estimate of (i) the difference between Closing Working Capital (xsuch estimate, the “Estimated Closing Working Capital Amount”), (ii) 56,820 the Closing Cash Amounts (such estimate, the “Estimated Closing Cash Amounts”), (iii) the Estimated Unpaid Company Transaction Expenses (such estimate, the “Estimated Unpaid Company Transaction Expenses”), and (yiv) the number of EBS's as Closing Indebtedness (such estimate, the “Estimated Closing Indebtedness”) and the resulting calculation of the Closing DatePurchase Price. The Closing Statement shall be prepared in accordance with the Transaction Accounting Principles, including for purposes of calculating the Working Capital, the use of the same line items and line item entries set forth on and used in the preparation of the Sample Working Capital Statement. 3.2.2 Adjustments on (b) Within ninety (90) days after the Closing Date, Purchaser shall cause to be prepared and delivered to Seller a pro rata basis as written statement (the “Post-Closing Statement”), setting forth the calculation of the Closing Date Working Capital, the Closing Cash Amounts, the Closing Unpaid Company Transaction Expenses and the Closing Indebtedness. The Post-Closing Statement shall be prepared in accordance with the Transaction Accounting Principles, including for purposes of calculating the Working Capital, the use of the same line items and line item entries set forth on and used in the preparation of the Sample Working Capital Statement. (c) Within forty-five (45) days following receipt by Seller of the Post-Closing Statement, Seller shall deliver written notice to Purchaser of any dispute Seller has with respect to the preparation or content of the Post-Closing Statement (the “Dispute Notice”); provided, that if Seller does not deliver any Dispute Notice to Purchaser within such forty-five (45)-day period, the Post-Closing Statement will be made final, conclusive and binding on the parties hereto. The Dispute Notice shall set forth in reasonable detail the basis for all prepaid expenses (any dispute included therein, the amounts involved and Seller’s determination of the Closing Working Capital, the Closing Cash Amounts, the Closing Unpaid Company Transaction Expenses and the Closing Indebtedness; provided, that any dispute set forth in the Dispute Notice shall be limited to the determination of the Closing Working Capital, the Closing Cash Amounts, the Closing Unpaid Company Transaction Expenses and the Closing Indebtedness, and Seller may not dispute the accounting principles, practices, methodologies and policies used in preparing the Post-Closing Statement unless they are inconsistent with the Transaction Accounting Principles. Upon receipt by Purchaser of a Dispute Notice, Purchaser and Seller shall negotiate in good faith to resolve any disputed items and amounts set forth therein, and the parties hereto agree that other than to the extent disputed in the Dispute Notice, the Post-Closing Statement will be final, conclusive and binding on the parties hereto. If Purchaser and Seller, such prepayments may accrue good faith effort notwithstanding, fail to Buyer's benefitresolve any such dispute within fifteen (15) Business Days following receipt by Purchaser of the Dispute Notice (the “Dispute Resolution Period”), prepaid income then Purchaser and accounts receivable Seller jointly shall engage, within ten (10) Business Days following the expiration of active subscribersthe Dispute Resolution Period, BDO US LLP or if BDO US LLP is unavailable, then a nationally recognized accounting firm selected jointly by Seller and Purchaser (the “Independent Accounting Firm”) to resolve any such dispute (and only such unresolved disputes in the Dispute Notice). If BDO US LLP is unavailable and Seller and Purchaser are unable to agree on the Independent Accounting Firm (if the firm agreed to is unavailable or conflicted), then each of Seller and Purchaser shall select a nationally recognized major accounting firm, and the two (2) firms will mutually select a third nationally recognized major accounting firm to reflect serve as the principle Independent Accounting Firm. As promptly as practicable, and in any event not more than fifteen (15) days following the engagement of the Independent Accounting Firm, Purchaser and Seller shall each prepare and submit a presentation detailing each party’s complete statement of proposed resolution of each issue still in dispute to the Independent Accounting Firm. Purchaser and Seller shall cause the Independent Accounting Firm to, as soon as practicable after the submission of the presentations described in the immediately preceding sentence and in any event not more than thirty (30) days following such presentations, make a final determination, binding on the parties hereto, of the appropriate amount of each of the line items that all expenses (including real estate taxesremain in dispute as indicated in the Dispute Notice. With respect to each disputed line item, stand such determination, if not in accordance with the position of either Seller or Purchaser, shall not be in excess of the higher, nor less than the lower, of the amounts advocated by Seller or Purchaser, as applicable, in their respective presentations to the Independent Accounting Firm described above. The scope of the disputes to be resolved by the Independent Accounting Firm shall be limited to determining any items still in dispute in the Dispute Notice in accordance with the terms of this Agreement, and the Independent Accounting Firm is not to make any other determination. All fees and assessment by any taxing authority for the Real Property) and income attributable expenses relating to the Business for work, if any, to be performed by the period prior Independent Accounting Firm shall be allocated between Purchaser and Seller in inverse proportion to the Closing Date are relative amounts of the aggregate of the disputed amounts determined by the Independent Accounting Firm to be for the account of Purchaser and Seller, respectively (i.e., so that the prevailing party bears a lesser amount of such costs, fees and expenses). All determinations made by the Independent Accounting Firm, and the Post-Closing Statement, as modified by the Independent Accounting Firm, will be final, conclusive and binding on the parties hereto. (d) For purposes of complying with the terms set forth in this Section 2.6, from and after the Closing, Seller and Purchaser shall reasonably cooperate with and make available to each other, the Independent Accounting Firm and each of their respective Representatives all expenses information, records, data and income attributable working papers, in each case to the extent related to the Business for or Transferred Entities, and shall permit reasonable access, upon advance written notice, during normal business hours to the period on books and after the Closing Date are for the account of Buyer; provided, however, that Seller and Buyer shall not prorate any items or expense payables under any Excluded Assets, all of which shall remain and be solely for the account of Seller. Seller will receive no credit for any accounts receivable (i) any portion of which is more than sixty (60) days past due as records of the Closing DateTransferred Entities and their personnel (subject to reasonable confidentiality restrictions and to providing such assurances, releases, indemnities or (ii) from subscribers whose accounts are inactive or whose service is pending disconnection for any reason other agreements as of the Closing Date. 3.2.3 All advance payments toaccountants may customarily require in such circumstances), or funds of third parties on deposit with, Seller as of the Closing Date, relating to the Business, including advance payments and deposits by subscribers served by the Business for converters, encoders, decoders, cable television service and related sales, will may be retained by Seller and will reduce the Base Purchase Price accordingly. 3.2.4 All deposits relating to the Business that are held by third parties as of the Closing Date for the account of Seller or as security for Seller's performance of its obligations (other than with respect to (i) Excluded Assets; and (ii) any other deposits the full benefit of which will not be available to Buyer following the Closing Date); provided, however, credit will be given for those deposits for which partial credit can be determined, including deposits on leases and deposits for utilities, will be credited to the account of Seller in their full amounts to increase the Base Purchase Price and will become the property of Buyer. 3.2.5 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by an amount equal to the difference between (i) the amounts of the reasonably required cumulative capital expenditures for each of the categories designated as Items 1 through 9 as set forth on SCHEDULE 7.2.1 through the month of the Closing and (ii) the amount of the capital expenditures actually incurred and paid in cash by Seller through the Closing Date in connection with each such corresponding capital expenditure categories. By way of example, SCHEDULE 7.2.1 sets forth a budgeted $5,000 per month in the year 2000 in capital expenditures for the category of New Construction. If the Closing Date were to occur in February 2000, the cumulative monthly capital expenditures for that category through February 2000 would total $147,000. To the extent that Seller had only expended $142,000 in cash in this category through the Closing Date, the reduction in the Base Purchase Price payable pursuant to Section 3.1.1 would be $5,000. Similar adjustments would be made on a category by category basis. 3.2.6 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by an amount equal to the difference between (i) the amounts of the Cumulative Capital Expenditures for the category designated as Item 10 as set forth on SCHEDULE 7.2.1 through the month of the Closing and (ii) the amount of the capital expenditures actual incurred and paid in cash by Seller through the Closing Date in connection with the category designated as Item 10 of SCHEDULE 7.2.1; providedpreparation, however, to the extent that through the date of Closing Seller has exceed the capital expenditure budgeted amounts for any analysis and review of the capital categories designated as Items 1 through 9 on SCHEDULE 7.2.1, such amounts shall be allowed as credit against Post-Closing Statement and the resolution of any reduction otherwise to be made pursuant to this Section 3.2.6disputes thereunder.

Adjustments to Base Purchase Price. The portion of (a) To determine the Base Purchase Price payable pursuant to Section 3.1.1 will be adjusted (as follows: 3.2.1 If the Business has fewer than 56,820 EBS's as of the Closing Dateherein defined), the Base Purchase Price will shall be reduced by an amount equal to $2,288 multiplied increased by the difference between following amounts in accordance with GAAP and ▇▇▇▇▇ standards: (x) 56,820 and (yi) the number amount of EBS's all ad valorem, production, severance, property or similar Taxes paid by Seller and relating to the Assets for periods from and after the Effective Time, calculated in a similar fashion as set forth in Section 2.3(b)(i); (ii) the aggregate amount of any and all operating costs paid by Seller that relate to the Closing DateAssets for periods from and after the Effective Time (excluding amounts for which the Base Purchase Price is increased pursuant to Section 2.3(a)(i) above), including, but not limited to, lease operating expenses, transportation and marketing expenses, lease payments, severance and production Taxes and producing overhead rates; (iii) the aggregate amount of any and all capital expenditures actually made by Seller or on Seller’s behalf in accordance with the terms of this Agreement and that relate to the Assets for periods from and after the Effective Time; and (iv) any other amount agreed upon by the parties in writing. 3.2.2 Adjustments on a pro rata basis as (b) To determine the Purchase Price, the Base Purchase Price shall be decreased by the following amounts: (i) the amount of all of Seller’s unpaid ad valorem, production, severance, property or similar Taxes relating to the Closing Date will be made for all prepaid expenses Assets, to the extent that such unpaid Taxes relate to periods of time before the Effective Time (to the extent that any such prepayments may accrue to Buyer's benefit)amount has not been finally determined by Closing or any other date of determination, prepaid income and accounts receivable of active subscribers, and to reflect such amount will be estimated based upon the principle that all expenses (including real estate taxes, stand by fees and assessment by any taxing authority amount paid for the Real Property) and income attributable to the Business previous year for the period prior to the Closing Date are for the account of Seller, and all expenses and income attributable to the Business for the period on and after the Closing Date are for the account of Buyer; provided, however, that Seller and Buyer shall not prorate any items same Asset or expense payables under any Excluded Assets, all of which shall remain and be solely for the account of Seller). Seller will receive no credit for any accounts receivable (i) any portion of which is more than sixty (60) days past due as of the Closing Date, or (ii) from subscribers whose accounts are inactive or whose service is pending disconnection for any reason as of the Closing Date. 3.2.3 All advance payments to, or funds of third parties on deposit with, Seller as of the Closing Date, relating to the Business, including advance payments and deposits by subscribers served by the Business for converters, encoders, decoders, cable television service and related sales, will be retained by Seller and will reduce the Base Purchase Price accordingly. 3.2.4 All deposits relating to the Business that are held by third parties as of the Closing Date for the account of Seller or as security for Seller's performance of its obligations (other than Such Taxes with respect to (i) Excluded Assets; and (ii) any other deposits a period which the full benefit Effective Time splits shall be prorated based on the number of days in such period which will not be available to Buyer following the Closing Date); provided, however, credit will be given for those deposits for which partial credit can be determined, including deposits fall on leases and deposits for utilities, will be credited to the account of Seller in their full amounts to increase the Base Purchase Price and will become the property of Buyer. 3.2.5 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by an amount equal to the difference between (i) the amounts each side of the required cumulative capital expenditures for each of the categories designated as Items 1 through 9 as set forth on SCHEDULE 7.2.1 through the month of the Closing and (ii) the amount of the capital expenditures actually incurred and paid in cash by Seller through the Closing Date in connection with each such corresponding capital expenditure categories. By way of example, SCHEDULE 7.2.1 sets forth a budgeted $5,000 per month in the year 2000 in capital expenditures for the category of New Construction. If the Closing Date were to occur in February 2000, the cumulative monthly capital expenditures for that category through February 2000 would total $147,000. To the extent that Seller had only expended $142,000 in cash in this category through the Closing Date, the reduction in the Base Purchase Price payable pursuant to Section 3.1.1 would be $5,000. Similar adjustments would be made on a category by category basis. 3.2.6 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by an amount equal to the difference between (i) the amounts of the Cumulative Capital Expenditures for the category designated as Item 10 as set forth on SCHEDULE 7.2.1 through the month of the Closing and (ii) the amount of the capital expenditures actual incurred and paid in cash by Seller through the Closing Date in connection with the category designated as Item 10 of SCHEDULE 7.2.1Effective Time; provided, provided however, to the extent that through such Taxes are computed based on the date of Closing Seller has exceed production from the capital expenditure budgeted amounts for any of the capital categories designated as Items 1 through 9 on SCHEDULE 7.2.1Assets, such amounts Taxes shall be allowed prorated between the parties based on the period in which such Production which is the basis for such calculation occurs, in the same manner as credit against any reduction otherwise the parties are entitled to receive (or be made credited with) such production pursuant to this Section 3.2.6the terms hereof; (ii) amounts equal to all revenues (net of royalty, overriding royalty payments and similar such payments) collected by Seller that are attributable to Production from the Assets (but not taking into account any ▇▇▇▇▇▇) and relating to periods of time from and after the Effective Time; (iii) amount equal to the Deposit; (iv) Suspense Funds; (v) and (vi) any other amount agreed upon by the parties in writing.

Adjustments to Base Purchase Price. The portion of the Base Purchase Price payable pursuant to Section 3.1.1 will shall be adjusted at Closing and upon Final Settlement (as hereinafter defined) as follows: 3.2.1 If (a) The Base Purchase Price shall be adjusted upward by the Business sum of the following (without duplication) (collectively, the “Sellers’ Credits”): (i) The value of all merchantable oil and condensate produced from and attributable to the Properties prior to the Effective Time which has fewer than 56,820 EBS's not been sold or taken by Sellers for its own account and is in storage at the Leases on the Closing Date (the “Inventory Hydrocarbons”), net of royalties and other burdens thereon, and less severance and production taxes, transportation expenses, and other fees deducted by the purchaser of such Hydrocarbons; (ii) All operating and capital expenditures paid by Sellers which are attributable, in accordance with generally accepted accounting principles, consistently applied (“GAAP”), to the operation of the Properties after the Effective Time; and (iii) An amount equal to any upward adjustment provided elsewhere in this Agreement or agreed between Sellers and Buyer in writing prior to or at Closing. (b) The Base Purchase Price shall be adjusted downward by the sum of the following (without duplication) (collectively, the “Buyer’s Credits”): (i) Amounts received by Sellers prior to Closing from the sale of Hydrocarbons produced and sold after the Effective Time which are attributable to the Properties; (ii) All operating and capital expenditures paid by Buyer which are attributable, in accordance with GAAP, to the operation of the Properties prior to the Effective Time; (iii) Sellers’ share of the amount of all ad valorem, property, and similar taxes and assessments (but not including income or franchise taxes) with respect to the Properties for the 2010 tax year which are unpaid as of the Closing Date, to the extent attributable to periods prior to the Effective Time, which amount shall, where possible, be computed based upon the tax rate and values applicable to the tax assessment period in question; otherwise, the amount of the adjustment under this paragraph shall be estimated based upon such taxes assessed against the applicable portion of the Properties for the immediately preceding tax assessment period just ended; (iv) An amount equal to the sum of any downward adjustments to the Base Purchase Price will be reduced by an for Title Defects and Casualty Loss; and (v) An amount equal to $2,288 multiplied by the difference any other downward adjustment as provided elsewhere in this Agreement or agreed between (x) 56,820 Sellers and (y) the number of EBS's as of the Closing Date. 3.2.2 Adjustments on a pro rata basis as of the Closing Date will be made for all prepaid expenses (to the extent such prepayments may accrue to Buyer's benefit), prepaid income and accounts receivable of active subscribers, and to reflect the principle that all expenses (including real estate taxes, stand by fees and assessment by any taxing authority for the Real Property) and income attributable to the Business for the period Buyer in writing prior to the Closing Date are for the account of Seller, and all expenses and income attributable to the Business for the period on and after the Closing Date are for the account of Buyer; provided, however, that Seller and Buyer shall not prorate any items or expense payables under any Excluded Assets, all of which shall remain and be solely for the account of Seller. Seller will receive no credit for any accounts receivable (i) any portion of which is more than sixty (60) days past due as of the Closing Date, or (ii) from subscribers whose accounts are inactive or whose service is pending disconnection for any reason as of the Closing Dateat Closing. 3.2.3 All advance payments to, or funds of third parties on deposit with, Seller as of the Closing Date, relating to the Business, including advance payments and deposits by subscribers served by the Business for converters, encoders, decoders, cable television service and related sales, will be retained by Seller and will reduce the Base Purchase Price accordingly. 3.2.4 All deposits relating to the Business that are held by third parties as of the Closing Date for the account of Seller or as security for Seller's performance of its obligations (other than with respect to (i) Excluded Assets; and (ii) any other deposits the full benefit of which will not be available to Buyer following the Closing Date); provided, however, credit will be given for those deposits for which partial credit can be determined, including deposits on leases and deposits for utilities, will be credited to the account of Seller in their full amounts to increase the Base Purchase Price and will become the property of Buyer. 3.2.5 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by an amount equal to the difference between (i) the amounts of the required cumulative capital expenditures for each of the categories designated as Items 1 through 9 as set forth on SCHEDULE 7.2.1 through the month of the Closing and (ii) the amount of the capital expenditures actually incurred and paid in cash by Seller through the Closing Date in connection with each such corresponding capital expenditure categories. By way of example, SCHEDULE 7.2.1 sets forth a budgeted $5,000 per month in the year 2000 in capital expenditures for the category of New Construction. If the Closing Date were to occur in February 2000, the cumulative monthly capital expenditures for that category through February 2000 would total $147,000. To the extent that Seller had only expended $142,000 in cash in this category through the Closing Date, the reduction in the Base Purchase Price payable pursuant to Section 3.1.1 would be $5,000. Similar adjustments would be made on a category by category basis. 3.2.6 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by an amount equal to the difference between (i) the amounts of the Cumulative Capital Expenditures for the category designated as Item 10 as set forth on SCHEDULE 7.2.1 through the month of the Closing and (ii) the amount of the capital expenditures actual incurred and paid in cash by Seller through the Closing Date in connection with the category designated as Item 10 of SCHEDULE 7.2.1; provided, however, to the extent that through the date of Closing Seller has exceed the capital expenditure budgeted amounts for any of the capital categories designated as Items 1 through 9 on SCHEDULE 7.2.1, such amounts shall be allowed as credit against any reduction otherwise to be made pursuant to this Section 3.2.6.

Adjustments to Base Purchase Price. The portion of (a) To determine the Base Purchase Price payable pursuant to Section 3.1.1 will be adjusted (as follows: 3.2.1 If the Business has fewer than 56,820 EBS's as of the Closing Dateherein defined), the Base Purchase Price will shall be reduced by an amount equal to $2,288 multiplied increased by the difference between following amounts: (x) 56,820 and (yi) the number amount of EBS's all ad valorem, production, severance, property or similar Taxes paid by Seller and relating to the Assets for periods from and after the Effective Time, calculated in a similar fashion as set forth in Section 2.3(b)(i); (ii) the aggregate amount of any and all operating costs paid by Seller that relate to the Assets for periods from and after the Effective Time (excluding amounts for which the Base Purchase Price is increased pursuant to Section 2.3(a)(i) above), including, but not limited to, lease operating expenses, transportation and marketing expenses, lease payments, severance and production Taxes; (iii) the aggregate amount of any and all capital expenditures actually made by Seller or on Seller’s behalf in accordance with the terms of this Agreement and that relate to the Assets for periods from and after the Effective Time; (iv) the sum of $350,000.00 per month (prorated for parts of months) between the Effective Time and the Closing Date, as Seller’s overhead; (v) the aggregate amount of money equal to the value of all liquid Hydrocarbons above the load line in tanks on the Leases or in connection with the Assets, as measured and recorded by Seller in the ordinary course of business on November 1, 2011, at a price per barrel of oil or condensate of $90.00; (vi) The value of Imbalances due to Seller from third parties, at $3.59 per MMBtu of gas; (vii) the cost of the audit to be performed pursuant to Section 5.13, unless Buyer otherwise pays such costs; and (viii) any other amount agreed upon by the parties in writing. 3.2.2 Adjustments on a pro rata basis as (b) To determine the Purchase Price, the Base Purchase Price shall be decreased by the following amounts: (i) the amount of all of Seller’s unpaid ad valorem, production, severance, property or similar Taxes relating to the Closing Date will be made for all prepaid expenses Assets, to the extent that such unpaid Taxes relate to periods of time before the Effective Time (to the extent that any such prepayments may accrue to Buyer's benefit)amount has not been finally determined by Closing or any other date of determination, prepaid income and accounts receivable of active subscribers, and to reflect such amount will be estimated based upon the principle that all expenses (including real estate taxes, stand by fees and assessment by any taxing authority amount paid for the Real Property) and income attributable to the Business previous year for the period prior to the Closing Date are for the account of Seller, and all expenses and income attributable to the Business for the period on and after the Closing Date are for the account of Buyer; provided, however, that Seller and Buyer shall not prorate any items same Asset or expense payables under any Excluded Assets, all of which shall remain and be solely for the account of Seller). Seller will receive no credit for any accounts receivable (i) any portion of which is more than sixty (60) days past due as of the Closing Date, or (ii) from subscribers whose accounts are inactive or whose service is pending disconnection for any reason as of the Closing Date. 3.2.3 All advance payments to, or funds of third parties on deposit with, Seller as of the Closing Date, relating to the Business, including advance payments and deposits by subscribers served by the Business for converters, encoders, decoders, cable television service and related sales, will be retained by Seller and will reduce the Base Purchase Price accordingly. 3.2.4 All deposits relating to the Business that are held by third parties as of the Closing Date for the account of Seller or as security for Seller's performance of its obligations (other than Such Taxes with respect to (i) Excluded Assets; and (ii) any other deposits a period which the full benefit Effective Time splits shall be prorated based on the number of days in such period which will not be available to Buyer following the Closing Date); provided, however, credit will be given for those deposits for which partial credit can be determined, including deposits fall on leases and deposits for utilities, will be credited to the account of Seller in their full amounts to increase the Base Purchase Price and will become the property of Buyer. 3.2.5 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by an amount equal to the difference between (i) the amounts each side of the required cumulative capital expenditures for each of the categories designated as Items 1 through 9 as set forth on SCHEDULE 7.2.1 through the month of the Closing and (ii) the amount of the capital expenditures actually incurred and paid in cash by Seller through the Closing Date in connection with each such corresponding capital expenditure categories. By way of example, SCHEDULE 7.2.1 sets forth a budgeted $5,000 per month in the year 2000 in capital expenditures for the category of New Construction. If the Closing Date were to occur in February 2000, the cumulative monthly capital expenditures for that category through February 2000 would total $147,000. To the extent that Seller had only expended $142,000 in cash in this category through the Closing Date, the reduction in the Base Purchase Price payable pursuant to Section 3.1.1 would be $5,000. Similar adjustments would be made on a category by category basis. 3.2.6 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by an amount equal to the difference between (i) the amounts of the Cumulative Capital Expenditures for the category designated as Item 10 as set forth on SCHEDULE 7.2.1 through the month of the Closing and (ii) the amount of the capital expenditures actual incurred and paid in cash by Seller through the Closing Date in connection with the category designated as Item 10 of SCHEDULE 7.2.1Effective Time; provided, provided however, to the extent that through such Taxes are computed based on the date production from the Assets, such Taxes shall be prorated between the parties based on the period in which the production which is the basis for such calculation occurs, in the same manner as the parties are entitled to receive (or be credited with) such production pursuant to the terms hereof; (ii) amounts equal to all revenues (net of Closing royalty, overriding royalty payments and similar such payments) collected or earned by Seller has exceed that are attributable to the capital expenditure budgeted amounts for sale of Hydrocarbons from the Assets (but not taking into account any ▇▇▇▇▇▇) and relating to periods of time from and after the Effective Time; (iii) the aggregate of the capital categories designated Title Defect Amounts (as Items 1 through 9 on SCHEDULE 7.2.1defined in the Title Defect Mechanism) with respect to those Title Defects that are asserted during the Title Examination Period and agreed to by Seller as an adjustment to the Base Purchase Price; (iv) the aggregate of the Environmental Defect Amounts with respect to Environmental Defects asserted prior to the Defect Deadline and agreed to by Seller as an adjustment to the Base Purchase Price; (v) the aggregate of the Allocated Values attributable to ▇▇▇▇▇ affected by Required Consents if the applicable consent is not received prior to Closing; (vi) the amount of the Suspense Funds as of the Closing Date; and (vii) the value of Imbalances payable by Seller, such amounts shall be allowed as credit against at $3.59 per MMBtu of gas; (viii) any reduction otherwise to be made pursuant to this Section 3.2.6other amount agreed upon by the parties in writing.

Adjustments to Base Purchase Price. The portion of Base Purchase Price shall be adjusted as follows, with the amount resulting from the below adjustments to the Base Purchase Price payable pursuant hereinafter referred to Section 3.1.1 will be adjusted as followsthe “Purchase Price”: 3.2.1 If the Business has fewer than 56,820 EBS's as of the Closing Date, the (a) The Base Purchase Price will shall be reduced adjusted upward by the following amounts (without duplication): (i) an amount equal to $2,288 multiplied by the difference between (x) 56,820 and (y) the number of EBS's as of the Closing Date. 3.2.2 Adjustments on a pro rata basis as of the Closing Date will be made for all prepaid expenses (to the extent such prepayments may accrue to Buyer's benefit), prepaid income and accounts receivable of active subscribers, and to reflect the principle that all expenses (including real estate taxes, stand by fees and assessment by any taxing authority for the Real Property) and income Property Costs attributable to the Business for ownership and operation of the period Purchased Assets which are incurred at or after the Effective Time and prior to the Closing Date are but paid by the Sellers (as is consistent with Section 2.9), but excluding, for the account avoidance of Sellerdoubt, (A) any Periodic Non-Income Taxes, (B) any income Taxes and (C) any amounts previously reimbursed to the Sellers pursuant to Section 2.9; (ii) an amount equal to, to the extent that such amounts have been received by the Purchaser and not remitted or paid to the Sellers in accordance with Section 2.9, all expenses and income proceeds from the production of Hydrocarbons from or attributable to the Business for Mineral Leases and the period on and after W▇▇▇▇ prior to the Closing Date are for the account of Buyer; providedEffective Time, however, that Seller and Buyer shall not prorate less any items or expense payables under any Excluded Assets, all of applicable Lease Burdens (which shall remain and have been paid or shall be solely for paid by the account Purchaser); (iii) the amount of Seller. Seller will receive no credit for any accounts receivable all Periodic Non-Income Taxes allocated to the Purchaser in accordance with Section 10.2 but that are paid or otherwise economically borne by the Sellers; and (iiv) any portion of the amount, if any, by which is more than sixty (60) days past due as the Estimated Cure Costs set forth on Section 2.6 of the Closing Date, or (ii) from subscribers whose accounts are inactive or whose service is pending disconnection for any reason as Seller Disclosure Schedule in respect of the Closing DatePurchased Contracts, taken as a whole, exceed the aggregate actual Cure Costs paid by the Purchaser in respect of the Purchased Contracts, taken as a whole. 3.2.3 All advance payments to, or funds of third parties on deposit with, Seller as of the Closing Date, relating to the Business, including advance payments and deposits by subscribers served by the Business for converters, encoders, decoders, cable television service and related sales, will be retained by Seller and will reduce the Base Purchase Price accordingly. 3.2.4 All deposits relating to the Business that are held by third parties as of the Closing Date for the account of Seller or as security for Seller's performance of its obligations (other than with respect to (ib) Excluded Assets; and (ii) any other deposits the full benefit of which will not be available to Buyer following the Closing Date); provided, however, credit will be given for those deposits for which partial credit can be determined, including deposits on leases and deposits for utilities, will be credited to the account of Seller in their full amounts to increase the Base Purchase Price and will become the property of Buyer. 3.2.5 The Base Purchase Price payable pursuant to Section 3.1.1 will shall be reduced adjusted downward by the following amounts (without duplication): (i) an amount equal to all Property Costs attributable to the difference between ownership and operation of the Purchased Assets which are incurred prior to the Effective Time but paid by the Purchaser (ias is consistent with Section 2.9), but excluding, for the avoidance of doubt, (A) any Periodic Non-Income Taxes, (B) any income Taxes and (C) any amounts previously reimbursed to the Purchaser pursuant to Section 2.9; (ii) an amount equal to, to the extent that such amounts have been received by the Sellers and not remitted or paid to the Purchaser in accordance with Section 2.9, all proceeds from the production of Hydrocarbons from or attributable to the Mineral Leases and W▇▇▇▇ at and after the Effective Time, less applicable Lease Burdens (which shall have been paid or shall be paid by the Sellers) and any other proceeds attributable to the Purchased Assets at and after the Effective Time; (iii) the amounts amount of all Periodic Non-Income Taxes allocated to the Sellers in accordance with Section 10.2 but that are paid or otherwise economically borne by the Purchaser; (iv) the amount, if any, by which the aggregate actual Cure Costs paid by the Purchaser in respect of the required cumulative capital expenditures for each of Purchased Contracts, taken as a whole, exceed the categories designated as Items 1 through 9 as Estimated Cure Costs set forth on SCHEDULE 7.2.1 through the month Section 2.6 of the Closing and Seller Disclosure Schedule in respect of the Purchased Contracts, taken as a whole; and (iiv) the amount of the capital expenditures actually incurred and paid in cash by Seller through the Closing Date in connection with each such corresponding capital expenditure categories. By way of example, SCHEDULE 7.2.1 sets forth a budgeted $5,000 per month in the year 2000 in capital expenditures for the category of New Construction. If the Closing Date were to occur in February 2000, the cumulative monthly capital expenditures for that category through February 2000 would total $147,000. To the extent that Seller had only expended $142,000 in cash in this category through the Closing Date, the reduction in the Base Purchase Price payable pursuant to Section 3.1.1 would be $5,000. Similar adjustments would be made on a category by category basisAccrued Suspense Funds. 3.2.6 The Base Purchase Price payable pursuant to Section 3.1.1 will be reduced by an amount equal to the difference between (i) the amounts of the Cumulative Capital Expenditures for the category designated as Item 10 as set forth on SCHEDULE 7.2.1 through the month of the Closing and (ii) the amount of the capital expenditures actual incurred and paid in cash by Seller through the Closing Date in connection with the category designated as Item 10 of SCHEDULE 7.2.1; provided, however, to the extent that through the date of Closing Seller has exceed the capital expenditure budgeted amounts for any of the capital categories designated as Items 1 through 9 on SCHEDULE 7.2.1, such amounts shall be allowed as credit against any reduction otherwise to be made pursuant to this Section 3.2.6.